KSE Ltd

Your Directors are pleased to present the 60^th Annual Report and the audited accounts for the financial year ended 31^st March 2024.

Your Directors recommend a final dividend of 300 % (Rs. 30.00 per share of Rs. 10 each) for the year ended 31^st March, 2024 that will be paid out of the profits of the Company for the year ended 31st March, 2024, absorbing a total amount of Rs.9.60 crores. The dividend income will be taxable in the hands of shareholders and income-tax at source will be deducted by the Company from the dividend being paid to the shareholders at the prescribed rates.

The final dividend of Rs. 30 per equity share of Rs. 10 each as recommended by the Board of Directors of the Company at their meeting held on 17^th May, 2024, if approved at the ensuing annual general meeting, will be paid to those shareholders, whose names appear in the Company's register of members as on

3^rd September, 2024. In respect of equity shares held in dematerialised form, the dividend will be paid to those beneficial owners of the equity shares as at the end of business hours on 27^th August 2024 as per the details furnished by the depositories for this purpose.”

The dividend payout for the year 2023-2024 has been decided in accordance with the Company's policy to pay sustainable dividend linked to long term growth objectives of the Company to be met out of internal cash accruals.

Pursuant to Section 124 and 125 of the Companies Act, 2013, the Company has transferred the unpaid or unclaimed dividend up to and including for the financial year 2015-2016 on respective due dates to the Investor Education and Protection Fund administered by the Central Government.

As per the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, the Company has uploaded the details of the Unclaimed Dividends as on 31st March, 2023 relating to the financial years from 2015-2016, on the website of the IEPF (www.iepf.gov.in) and on the website of the Company atwww.kselimited.com.

The dates of declaration of Dividend since final dividend for 2016-2017 and the corresponding dates when unclaimed dividends are due to be transferred to the Central Government are given in the following table:

The Company proposes to transfer 640.0 lakhs to the General Reserve out of the amount available for appropriations and an amount of Rs.6125.41 lakhs is proposed to be retained as Surplus.

The Company has reported a profit of Rs. 17.19 crores after adjustment for taxes in the year 202324 compared to loss of Rs. 2.33 crores in the previous year. During the year ended 31^st March, 2024, the Revenue from Operations registered an increase of 4.6 % to Rs. 1683 crores from Rs. 1610 crores in the previous year. The profit for the year 2023-24 is after providing for the exceptional item of R.s 409.54 Lakhs for the year ended 31.03.2024 which is net of the exceptional loss of Rs. 413.80 Lakhs, pertaining to the damage of raw materials due to floods in Tamil Nadu (Rs.409.70 Lakhs based on provisional assessment) and transit damage (Rs. 4.10 Lakhs) and the exceptional income of Rs. 4.26 Lakhs (corresponding figure for the year ended 31.03.2023 Rs. 118.47) on account of receipt of insurance claim received in part against the claim lodged during the financial year 2021-22. The company has lodged claims with the insurance company and the settlement from the insurance company is yet to be received. However, the management is confident of recovering the loss from the insurance company in full. The Earnings Per Share reported is Rs. 55.03 per share compared to negative earnings of Rs. (7.44) in the previous year 2022-23.

In the year 2023-24, the average raw material cost of feed for first two quarters has gone up by 5.0 % over that of previous year. In year 2023-24, the average selling price of feed has increased by around 9.6% compared to that of previous year as a result of increase in feed price three time during last financial year in order to avoid loss. The cattle feed division faced multiple profitability headwinds

during the first two quarters which was predominantly due to material price inflation. However, the company has made various measures to keep the material price increase intact which has resulted in profit of 40.4 Crores compared to previous year profit of Rs. 7.91 crores.

In the cake processing division, the scarcity of local copra cakes continues for the current year as well. We had to continue to depend mainly on the imported copra cake for our processing which was also was its highest during first two quarters of the financial year 2023-24. The year-to-year annual average rate of consumption of cake has not varied much. The purchase rate of copra cake was on the higher side in previous year itself around Rs. 29,671 per ton, which has gone up to the level of Rs. 32,857 per ton, during first quarter of FY 202324. At the same time, the average realisation for coconut oil is Rs. 1.13 lakhs per ton during the year 2023-24, whereas the same was Rs. 1.19 Lakhs, Rs. 1.47 lakhs and Rs. 1.54 lakhs per ton respectively for years 2022-23, 2021-22 and 2020-21. In March, 2021 the coconut oil price was around Rs. 1.90 lakhs per ton which came down to the level of Rs. 1.15 lakhs per ton in March, 2023 and the company has witnessed lowest selling price of Rs.1,03,000 during FY 2023-24. Due to the steep fall in the price of refined coconut oil during the year 2022-23 & 2023-24, the turnover of cake processing division has reduced by 11.94% and 6.96% respectively.

There was no margin on the milk division since the procurement of milk in Tamil Nadu is ruling very high and the selling price of milk in Kerala is still lower and there has not been any increase in selling price of milk during FY 2023-24. As such, we had incurred loss of Rs. 121 lakhs in the milk division compared to Rs. 104 lakhs in the previous year. The relaunch of Vesta ice cream is underway, with a continuing huge advertisement budget, after the covid spell, to re-establish the market share and also to reach the market across Kerala. We have improved the markets with premium

varieties and are pushing ahead to capture more market share. We have also made price revision of ice cream which has resulted in additional recovery in contribution margin. We have also on boarded a well know celebrity as brand ambassador which has helped the brand reach across Kerala Region. Since we are trying to expand our reach to the market for ice cream, we are appointing new dealers in fresh markets. On such appointments of new dealers, we are offering freezer subsidy, which is also chargeable to the cost of ice cream. Dairy division as a whole reported a loss of Rs. 342.19 lakhs in year 2023-24 against the previous year loss of Rs. 641.64 lakhs.

The company during previous year had engaged a reputed agency to review the report on various operation of the company and to formulate strategies. During FY 2023-24 the agency has submitted a detailed finding and suggestions for improvement. The findings and suggestions are under discussion for implementation.

More information relating to the operations of the Company has been furnished in the Management Discussion and Analysis Report attached to and forming part of this Report as provided by SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The Company has won the SEA Award constituted by Solvent Extractors' Association of India for highest processor of coconut oil cake for the year 2022-2023. This Award is being received by the Company for the past 33 years consecutively since the inception of the award.

Ten meetings of the board were held during the year. For details of the meetings of the board, please refer to the corporate governance report, which forms part of this report.

Dr. Jose Paul Thaliyath (DIN 01773031), Mrs. Nina Paul (DIN: 08576074), Mr. Jose John (DIN: 01797056) and Mr. Paul Jose (DIN: 01616504) are the Independent Directors of the Company. The Independent Directors of the Company are not liable for retirement by rotation, as provided in Section 149 of the Companies Act, 2013. In accordance with Section 149 (7) of the Companies Act, 2013, the Company has received declarations from all the independent directors of the Company confirming that they meet the criteria of independence as prescribed under the Companies Act, 2013 and as per SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

All the above five independent directors of the Company had enrolled with Indian Institute of Corporate Affairs' (IICA) within the prescribed period and had cleared the online proficiency selfassessment test as provided by Companies (Appointment and Qualification) Rules, 2019. In the opinion of the Board of Directors, the independent directors have relevant proficiency, expertise, and experience.

In accordance with the provisions of the Companies Act, 2013 read with the Rules issued thereunder, the Listing Regulations and the Articles of Association of the Company, the Independent Directors, the Managing Director and Executive Director of the Company are not liable to retire by rotation.

Mr. Verghese CV (DIN: 00779894), Independent Director has informed the Board that he does not wish to continue on the Board as an Independent Director for the second term. The Company has received notice in writing under Section 160 of the Companies Act, 2013 from a member signifying the intention to propose Mr. K. Hari Kumar (DIN: 00388466) for appointment as an Independent Director of the Company. He is a senior business leader, with a successful track record of corporate turnaround having more than 20 years' experience in the Board level. He has more than 42 years' experience in the Indian Chemical Industry and has deep insight into organic, Inorganic chemicals, petrochemicals, pharmaceuticals, speciality chemicals and agrochemicals industry in India. Mr. K. Hari Kumar (DIN: 00388466), has been proposed to appointed as an Independent Director of the Company to hold office for a period of five consecutive years from 25^th September, 2024 to 24^th September, 2029.

In the opinion of the Board Mr. K. Hari Kumar fulfils the conditions for his appointment as an Independent Directors as specified in the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and they are independent of the management. The Board, based on the performance evaluation and as per the recommendation of the Nomination and Remuneration Committee, considers that, given their background and experience and contributions made by them during their tenure, their association with the Company would be beneficial to the Company and it is desirable to avail his services as Independent Director.

Mr. P.D. Anto (DIN : 00106965), and Mrs. Marykutty Varghese (DIN : 07307987) will retire by rotation at the ensuing annual general meeting, in accordance with the provisions of the Companies Act, 2013 and the Articles of Association of the Company, and being eligible, offer themselves for reappointment. Mr. P. D. Anto is attaining the age of 75 during FY 2024-25, hence, his appointment is subject to approval by shareholders by special resolution.

Ms. Simi Davis (DIN 09752318), Director, who retires by rotation at the ensuing Annual General Meeting (AGM) has expressed her unwillingness to be re-appointed.

The Board has decided to fill up the vacancy of directorship of Ms. Simi Davis (DIN 09752318) on her retirement as Director as on 3^rd September, 2024, by appointing Mr. Shaji Puthenpurayil Jacob (DIN 10647012) as Director of the Company and an ordinary resolution has been moved in the ensuing annual general meeting for his appointment as a director. The Company has received a notice u/s 160 of the Companies Act, 2013 from a Member of the Company signifying his intention to propose the candidature of Mr. Shaji Puthenpurayil Jacob for the office of the Director of the Company.

Mr. Sankaranarayanan R, Chief Financial Officer retired from the service on 22nd June 2023 and Mr. Senthil Kumar Nallamuthu, assumed the role of Chief Financial Officer w.e.f. 23rd June 2023.

Mr. M.P. Jackson (DIN 01889504), Managing Director, Mr. Paul Francis (DIN 00382797), Executive Director, Mr. Senthil Kumar Nallamuthu, Chief Financial Officer, and Ms. Srividya Damodaran, Company Secretary are the Key Managerial Personnel of your Company in accordance with the provisions of Sections 2(51) and 203 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

Remuneration policy in the Company is designed to create a high-performance culture. It enables the Company to attract, retain and motivate employees to achieve results. The Company pays remuneration by way of salary, benefits, perquisites and allowances to its Managing Director and the Executive Director. Currently, the sitting fees payable to the non-executive directors is Rs. 25,000 per meeting of the Board and Rs. 20,000 per meeting of committees of the Board attended by them. The Nomination and Remuneration Policy for the Members of Board and Executive Management can be accessed on the Company's website at the link: https://www.kselimited.com/investors/policies

The Company has devised a Policy for performance evaluation of Independent and other directors, Board as a whole and Committees thereof which include criteria for performance evaluation of the executive and non-executive directors. The Policy for evaluation of performance of the Board of Directors can be accessed on the Company's website at the link: https://www.kselimited.com/investors/policies

In terms of provisions of the Companies Act, 2013 read with Rules issued thereunder and as per SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of Directors have evaluated the effectiveness of the Board during the financial year ended 31^st March, 2024. The evaluation was based on questionnaire and feedback from all the Directors on the Board as a whole, Committees and self-evaluation. Directors, who were designated, held separate discussions with each of the Directors of the Company and obtained their feedback on overall Board effectiveness as well as each of the other Directors. The evaluation of the Directors was based on various aspects which, inter alia, included the level of participation in the Board Meetings, understanding of their roles and responsibilities, business of the Company along with the environment and effectiveness of their contribution.

A separate meeting of the independent directors was convened, which reviewed the performance of the Board (as a whole), the non-independent directors and the Chairman.

Your Company believes in the conduct of the affairs of its constituents in a fair and transparent manner by adopting highest standards of professionalism, honesty, integrity and ethical behaviour. The Company is committed to develop

a culture where it is safe for all employees to raise concerns about any poor or unacceptable practice and any event of misconduct. Accordingly, the Board of Directors have formulated a Whistle Blower Policy which is in compliance with the provisions of Section 177 (10) of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The policy provides for a framework and process whereby concerns can be raised by its employees against any kind of discrimination, harassment, victimization or any other unfair practice being adopted against them. More details on the vigil mechanism and the Whistle Blower Policy of your Company have been outlined in the Corporate Governance Report which forms part of this report. The "KSEL Whistle Blower Policy and Vigil Mechanism” can be accessed on the Company's website at the link :

https://www.kselimited.com/investors/policies.

Pursuant to Section 134(3)(c) of the Companies Act, 2013, the Directors confirm that:

a. in the preparation of the annual accounts for the financial year ended 31st March, 2024, the applicable accounting standards and Schedule III of the Companies Act, 2013, have been followed and there are no material departures from the same;

b. the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of your Company as at 31st March, 2024 and of the profit of the Company for the financial year ended 31st March, 2024;

c. proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. the annual accounts have been prepared on a 'going concern' basis;

e. proper internal financial controls laid down by the Directors were followed by the Company and that such internal financial controls are adequate and were operating effectively; and

f. proper systems to ensure compliance with the provisions of all applicable laws were in place and that such systems were adequate and operating effectively.

Corporate Governance Report, Management Discussion and Analysis Report and Certificate from Auditors on Corporate Governance have been furnished separately and form part of this report. The disclosures made in these reports may be considered as compliance of various disclosures prescribed under the Companies Act, 2013 and Rules made thereunder.

The Corporate Social Responsibility (CSR) Committee has been formed in conformity with Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) Rules, 2014. The composition, terms of reference and attendance details of the CSR Committee are incorporated in the Corporate Governance Report. The Annual Report on CSR activities for the year ended 31^st March, 2024 is given separately as "Annexure A”, forming part of this Report.

Your Company is accepting deposits as per the provisions of Sections 73 and 76 of the Companies Act, 2013 read together with the Companies (Acceptance of Deposits) Rules, 2014. The details relating to such deposits as provided under Rule 8 of the Companies (Accounts) Rules, 2014 are provided in "Annexure B”.

The Company is not accepting any other deposits which are not in compliance with the requirements of Chapter V of the Companies Act, 2013.

The particulars of loans, guarantees and investments have been disclosed in the financial statements.

All contracts/arrangements/transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an arm's length basis. During the year, the Company had not entered into any contract/arrangement/ transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions. None of the transactions with related parties falls under the scope of Section 188(1) of the Companies Act, 2013 (the "Act”). Full disclosure of related party transactions as per Accounting Standard Ind AS 24 issued by the Ministry of Corporate Affairs is given under Note No. 35.24 of Notes to the Annual Accounts.

The policy and procedures on related party transaction as approved by the Board may be accessed on the Company's website at the link: https://www.kselimited.com/investors/policies. Information on transactions with related parties pursuant to Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014 are given in "Annexure C” in Form AOC-2 and the same forms part of this report.

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return as on 31^st March, 2024 is available on the website of the

Company at

https://www.kselimited.com/investors. STATUTORY AUDITORS

M/s. Sridhar & Co. (ICAI Firm Registration No. 003978S) have been appointed as the statutory auditors of the company at the 56th Annual General Meeting from the conclusion of 56th Annual General Meeting until the conclusion of the 61st annual general meeting of the Company to be held in the year 2025, for the audit of accounts relating to the years ending 31st March, 2021 to 31st March, 2025.

The Auditor's Report for the financial year 20232024 on the financial statements of the Company is part of this Annual Report. The Auditors have issued an unmodified opinion on the Financial Statements for the financial year ended 31st March, 2024.

With the prior approval of Central Government, M/s. A. R. Narayanan & Co. (Firm registration number 101421) have been appointed as Cost Auditors for the financial year 2023-24 and they will be submitting their Cost Audit Report within the time limit stipulated. The Board of Directors of the Company, on the recommendations made by the Audit Committee, has appointed , M/s. BBS & Associates, Cost Accountants, Ernakulam (Firm registration number 000273) as the Cost Auditor of the Company to conduct the audit of cost records for the financial year 2024-2025. The Remuneration proposed to be paid to the Cost Auditor, subject to ratification by shareholders of the Company at the ensuing 60th Annual General Meeting, has been fixed at Rs. 2,25,000 plus GST and out of pocket expenses. The Company has received consent from M/s. BBS & Associates, Cost Accountants, Ernakulam, Cost Accountants, to act as the Cost Auditor for conducting audit of the cost records for the financial year 2024-25, along with certificate confirming their independence and arm's length relationship.

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, your Company has appointed M/s. BVR & Associates Company Secretaries LLP (Firm Regn. AAE-7079), Practicing Company Secretaries to conduct the Secretarial Audit of your Company for the financial year ended 31st March, 2024. The Secretarial Audit Report for the financial year ended 31st March, 2024 is annexed herewith as "Annexure D” to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

The Company is required to maintain cost records as specified by the Central Government under sub-section (1) of section 148 of the Companies Act, 2013, for certain areas of its operations (Edible Oil and Power Generation) and accordingly accounts and records required to get true and fair view of the cost of production of products, cost of sales, margin and other information relating to products under reference, are made and maintained by the Company.

The Company has zero tolerance for sexual harassment at workplace. The company has complied with the provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at

Workplace (Prevention, Prohibition and Redressal) Act, 2013. During the financial year 2022-23, the Company has not received any complaint on sexual harassment and no complaint remains pending as of 31^st March, 2024.

The information required under Section 197 of the Companies Act, 2013 and rules made there-under, in respect of employees of the Company, is provided in "Annexure E” forming part of this report. None of the employees are in receipt of remuneration in excess of the limits specified under clause (2) of Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

The particulars as prescribed under Rule 8(3) of the Companies (Accounts) Rules, 2014, are set out in "Annexure F” to this Report.

The company has completed installation 5.5 TPH Boiler costing 4.13 Crores at Koratty Solvent Extraction Facility and started functionig. The construction of warehouses, with an estimated capital outlay of around Rs. 1000.00 lakhs, in the 6.38 acres of land allotted near the port by the VOC Port, Tuticorin is nearing completion. Construction of additional storage facility near Irinjalakuda Unit, costing around Rs. 130.00 lakhs has been completed. The company has capitalised fire extinguisher at Irinjalakuda after obtaining necessary approval from Fire Department.

No disclosure is made in respect of the following

items as there were no events during the year calling for reporting on these items:

1. There was no issue of equity shares with differential rights as to dividend, voting or otherwise.

2. There was no issue of shares (including sweat equity shares and ESOP) to employees of the Company under any scheme.

3. Your Company does not have any subsidiary, associate, joint venture company or holding company and disclosures required in that respect were not dealt with.

4. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern. status and Company's operations in future.

5. No frauds have been reported by auditors to the Audit Committee or Board under Sub-section (12) of Section 143 of the Companies Act, 2013.

6. There are no material changes or commitments affecting the financial position of the Company which have occurred between the end of the financial year under report and the date of this report.

Your Directors wish to place on record their sincere appreciation for the assistance and co-operation received from shareholders, bankers, especially ICICI Bank, Registrars and Share Transfer Agents, customers, distributors and suppliers. Board also acknowledge the valuable committed services of the executives, staff and workers of the Company.